Credit enhancement

Our credit enhancement operations aim to enhance access to finance to small and medium sized enterprises (SMEs) in the EU Member States and Candidate Countries as well as in the European Free Trade Association (EFTA) countries.

By facilitating the execution of securitisation transactions, we provide guarantees to banks and financial institutions allowing them to diversify their funding sources and to achieve economic and regulatory capital relief through credit risk transfer.

We focus mainly on :

• SME loans
• SME loan guarantees
• Small ticket lease receivables
• SME trade receivables
• Venture financing (lease/loans)
• Micro-loans

What are the benefits for the selected financial institutions ?

• Our Asset-backed securities are assigned its AAA/Aaa/AAA rating.
• We can can sell protection on the underlying portfolio itself, e.g. directly to the benefit of the originator in synthetic deals.
• Credit risk transfer and capital relief - through the placement of notes with cash investors or otherwise - are further facilitated by the zero risk-weighting assigned to the assets we guarantee (Basel II), thanks to our Multilateral Development Bank status. 
• Our guarantees are offered at competitive prices, after a detailed analysis of the transaction and of the originator

What kind of guarantees are available?

We can provide various types of guarantees (such as wraps, bilateral guarantees, credit default swaps, etc.) on senior and/or mezzanine tranches of risk, typically with a minimum rating equivalent to BB/Ba2.

Guarantees on ABS are provided in different forms, such as wraps or bilateral guarantees to the noteholders.